All posts tagged Bain

One of the recommendations made by today’s U.S. House of Representative’s report on China’s Huawei Technologies is it shouldn’t be allowed to make acquisitions. But the U.S. government hasn’t shown much hesitation in blocking Huawei deal making so far.

Associated Press

The report says the technology giant could be a security risk and recommends among other things that Huawei be blocked from buying U.S. companies. The central allegation revolves around concerns about China meddling in the company.

The company denies the allegations and argues it has every business incentive to say no to Beijing. It called the report “China-bashing.”

But Huawei already has a history of its proposed acquisitions of U.S. companies being shot down by U.S. regulators. Even deals it has considered making have drawn attention.

In 2007, it joined up with private-equity company Bain Capital to make a bid for 3Com Corp., a networking company that was drawing attention from buyers. 3Com agreed to the $2.2 billion deal, with Bain buying 80% of the company.

Six months later the deal was dead when Bain walked away after the Committee on Foreign Invesment said it would block the deal. That came after a number of lawmakers had expressed concern about the security implications of allowing a Chinese-owned entity to exercise influence over 3Com, which sold antihacking and other network-security services to the Defense Department.

The “American Idol” hosts’ investment company just got $300 million from Thomas H. Lee Partners and Bain Capital today, money he plans to turn into a media empire.

That’s coupled with an investment from Clear Channel (which is owned by the two firms). The radio broadcaster is taking a minority stake in Ryan Seacrest Productions, the production company behind “Keeping Up with the Kardashians” and its seemingly endless possibilities of spin-offs.

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Dealpolitik is Ronald Barusch's strategic look at deals currently making the headlines as well as the major forces at work in the deal-making world. He was a M&A lawyer with Skadden, Arps, Slate, Meagher & Flom for over 30 years. He retired in 2010 after 25 years as a partner at the firm. Click here for his current and archived columns.